Norske Skog ASA

Investor Presentation • Jul 14, 2023

Q2 2023 presentation 14 July 2023

Sustainable and innovative industry

Strategic transition

• Publication paper
• Packaging paper
• Energy and bio products

2020-22 Invest	2023-24 Ramp-up	2025-26 Harvest

• Cost leading producer of publication paper
• Capacity: 1 750kt
• Utilisation target: +90%
• EBITDA margin target: +10%
• Ramping up production of packaging paper
• Capacity: 760kt
• Utilisation target: +95% (2025-26)
• EBITDA margin target: +20%
• Net debt of NOK 1.7bn
• Remaining net expansion capex NOK 1.4bn
• Cash NOK 2.7bn and liquidity NOK 4.0bn

Five high quality industrial sites

Eleven paper machines with supporting infrastructure for energy, fibre and water

Second quarter in brief

Strong financial position and reduced earnings into market downturn

EBITDA in the quarter of NOK 380m including business interruption at Saugbrugs of NOK 90m covering May and June Net debt of NOK 1 746m and leverage ratio of 0.7x, cash of NOK 2 673m

Markets remain challenging with price and profitability pressure

Publication paper prices lower due to continued demand decline and lower raw material costs, further closures required Containerboard prices stabilising, but additional capacity closures required

Saugbrugs PM6 temporary stopped since 27 April due to rockslide, covered by insurance

Extent of damages and rebuild yet to be determined, but PM6 likely to remain closed through H1 2024 The mill is insured for property damages and business interruption for up to 18 months

Bruck PM3 ramp-up according to plan, Golbey PM1 start-up delayed

Production and product quality at Bruck PM3 in line with plan, expect full utilisation in H2 2025 Golbey PM1 start-up moved to Q2 2024

Board resolves to initiate a share repurchase programme

The board resolved on 13 July to repurchase up to 10% of the share capital in line with AGM authorisation

Repurchase programme commences on 14 July until earlier of 31 December 2023 or when repurchase amount is reached

Update on rockslide at Saugbrugs

• Rockslide on 27 April damaging buildings, machinery and equipment
• No one was physically harmed
• Main work in Q2 has been to secure the site, remove rocks and debris to get access to the paper machine
• PM6 (260kt SC capacity) will likely remain closed through H1 2024
• Saugbrugs has insurance coverage for property damages and business interruption for up to 18 months
• For May and June, Norske Skog has recognised business interruption of NOK 90m in other revenue and EBITDA

Bruck PM3 ramp-up according to plan and update on Golbey PM1

Bruck PM3

• Ramp-up of containerboard production at Bruck PM3 according to plan. Deliveries of ~10kt in Q2 expected to more than double for Q3
• Improving production cost as utilisation and optimisation increases

Golbey PM1

• Start-up of Golbey PM1 moved to Q2 2024 to reflect revised time plan for installation work. Start-up aligned with commissioning of new biomass boiler from Green Valley Energie
• Net investment increase from EUR 250m (June 2020 budget) to EUR 265m, including energy related grants and certificates paid in 2023-27

Group financials

Segment financials

Publication Paper Europe	Q2'22	Q3'22	Q4'22	Q1'23	Q2'23
Operating rate, %	90%	83%	74%	77%	74%	Pressure on prices and profitability
Deliveries, thousand tonnes	407	347	300	245	267
Total operating income	3 469	3 129	3 551	2 864	2 843	Business interruption for May and June of
EBITDA	909	483	1 131	763	429	NOK 90m included in other revenue and
EBITDA margin, %	26.2%	15.4%	31.8%	26.6%	15.1%	EBITDA
						Austria approved CO compensation for
Publication Paper Australasia	Q2'22	Q3'22	Q4'22	Q1'23	Q2'23	2 2022 to be paid in 2023, the amount of EUR
Operating rate, %	98%	94%	98%	83%	92%
Deliveries, thousand tonnes	63	66	63	56	63	4.7m has been recognised in Q2 2023
Total operating income	470	514	508	434	489
EBITDA	49	33	33	-23	-5	Publication Paper Australasia
EBITDA margin, %	10.4%	6.3%	6.5%	-5.2%	-1.1%	Improving operations, but challenging
						profitability due to raw material prices
Packaging Paper	Q2'22	Q3'22	Q4'22	Q1'23	Q2'23
Operating rate, %				0%	71%	Price increases implemented for H2 2023
Deliveries, thousand tonnes				0	10
Total operating income				24	75	Packaging Paper
EBITDA				-38	-40
EBITDA margin, %				n.a.	-53.9%	Production ramp-up according to plan in
						challenging markets
Other activities	Q2'22	Q3'22	Q4'22	Q1'23	Q2'23
Total operating income	133	71	61	61	89	Other activities
EBITDA	-54	-8	-81	-27	-2	Reduced valuation of LTI programme

Publication Paper Europe

• Pressure on prices and profitability
• Business interruption for May and June of NOK 90m included in other revenue and EBITDA
• Austria approved CO² compensation for 2022 to be paid in 2023, the amount of EUR 4.7m has been recognised in Q2 2023

Publication Paper Australasia

• Improving operations, but challenging profitability due to raw material prices
• Price increases implemented for H2 2023

Packaging Paper

Production ramp-up according to plan in challenging markets

Other activities

Input costs down from peak, but remain at high levels

Prices lower due to easing costs and soft demand

Challenging market balance

Initiating share repurchase programme

The board has decided to initiate a share repurchase programme in accordance with the authorisation granted by the AGM on 20 April 2023

• The maximum number of shares that can be repurchased is 9 426 470 shares (10% of the share capital)
• The maximum consideration is NOK 472 million
• The minimum price is NOK 1 and maximum price is NOK 100
• The number of shares acquired per day shall not exceed 116 726 shares
• The programme commences on 14 July 2023 until earlier of 31 December 2023 or when maximum number of shares have been repurchased
• Repurchase programme may be discontinued at any time and further announcements will be made if and when appropriate
• The purpose is to return excess capital to shareholders and shares repurchased will be cancelled subject to approval by AGM in 2024
• The share repurchase programme will be carried out by way of repurchases in the market and transactions will be reported weekly

Outlook

• Raw material and energy costs stabilising, but development remains uncertain
• Paper prices influenced by lower input costs and weak market balance
• Containerboard prices with signs of stabilising, but still a challenging market
• Further capacity closures and industry consolidation required in all markets
• Introduction of Norske Skog Bruck in the recycled containerboard market well underway, but expect negative EBITDA from packaging paper segment in 2023 as production ramps up
• Maintaining a healthy balance sheet, strong liquidity position, and low production costs
• Capital Markets Day in Oslo on 16 November, details to be provided

green value

Norske Skog ASA Postal address: P.O. Box 294 Skøyen, 0213 Oslo, Norway Visitors: Sjølyst Plass 2, 0278 Oslo, Norway

Phone: +47 22 51 20 20 Email: info@norskeskog.com Email: ir@norskeskog.com

This presentation contains statements regarding the future in connection with Norske Skog's growth initiatives, profit figures, outlook, strategies and objectives . All statements regarding the future are subject to inherent risks and uncertainties, and many factors can lead to actual profits and developments deviating substantially from what has been expressed or implied in such statements . We create